US must now deal with fiscal cliff: Swan

Treasurer Wayne Swan says US presidential winner Barack Obama will have to deal almost immediately with the so-called "fiscal cliff" to prevent the US economy reeling into recession early next year and dragging the rest of the world with it.

While counting was continuing in the US ballot, US media networks called the victory for the incumbent over challenger Republican Mitt Romney.

"There is a lot of uncertainty in the global economy, and that uncertainty relates to Europe but also to how America will deal with the impending fiscal cliff," Mr Swan told Sky News while in Washington, and before ballot booths had closed.

Automatic tax increases and spending cuts are scheduled to come in at the beginning of next year, which could see a recession in the US economy if left unattended.

"That would have a dramatic impact and flow-on effect to the global economy, and in turn would impact on Australia," Mr Swan said.

Asked if Australia's promised budget surplus would be buried if the US failed to deal with its own budget problems, Mr Swan declined to deal with "hypothetical situations".

"We are looking at relatively weak global growth. Fortunately we are still in the stronger part of the world when it comes to economic growth, and I want to see it stay that way," he said.

Back at home, the Reserve Bank of Australia (RBA) will be watching Thursday's official labour force data with great interest, after surprising many economists by not cutting the cash rate again at Tuesday's monthly board meeting.

Last month's stronger-than-expected inflation data was seen as a key factor in its decision.

This was despite the labour market generally softening in recent months and the unemployment rate rising to a two-year high of 5.4 per cent in September.

For October, economists are forecasting a modest 5000 rise in the number of people employed, but not enough to prevent the jobless rate ticking up to 5.5 per cent.

TD Securities head of Asia-Pacific research Annette Beacher said the unemployment rate had been "well behaved" in a range of 5-5.25 per cent until September.

"While leading indicators of jobs continue to be very weak, we think the unemployment rate will probably hover within a 5.5-5.75 per cent range next year, rather than a 6-handle," she said in her quarterly Asia-Pacific report.

The government's leading employment index rose for a fourth consecutive month in November, after falling for seven straight months.

"It is still too early to confirm that a renewed quickening in the pace of employment growth above its long-term trend rate of 1.6 per cent per annum is in prospect, because the indicator has risen for fewer than six consecutive months," the Department of Education, Employment and Workplace Relations said.

The leading jobs indicator anticipates movements in the growth cycle of employment, with a turning point confirmed after six consecutive monthly moves in the same direction.